In these austere times, some of the biggest businesses on the planet are struggling financially. Therefore it is inevitable that there are also a number of businesses who are not so prominent that are also finding it tough to meet their financial obligations and carry on providing services to their usual high standards.
There are many options available for securing cash or rejuvenating your business’ financial situation, and we looked at some of the best ideas.
Private Equity Investment
If you are seeking additional motivation and support in the running of your business then private equity investment could well be the way forward for you. The downside is that you will be giving up a portion of your future profits, however that is probably a favourable option if you have found yourself in the situation where you desperately need a cash injection to even stay afloat.
Whether you seek this investment from a private equity fund or a venture capital provider, you will need to produce a strong plan of how you are going to generate revenues and profits moving forward, and be prepared to be brutally honest with yourself and potential investors with regard to the situation you have found yourself in. Demonstrating an ability to learn from past mistakes and not allow them to cloud judgment or decision-making moving forward will also see you looked upon favourably.
Bank loans have always been the most traditional manner of seeking a cash injection, however with the difficulties now associated with getting credit many are moving away from this and looking at other areas. If you are able to secure a favourable rate, however, and perhaps even a payment holiday at the start of your repayment period, then a bank loan could be just what you need.
One of the big advantages of a bank loan is that you are repaying small chunks constantly, where should you seek private equity or venture capital investment you are more likely to find yourself paying a lump sum at the end of an agreed period of financial backing.
Visit the Accountant
Of course, you would visit your business accountant anyway, at least we hope you would, before taking out a loan or seeking another form of equity.
Take the opportunity to review your current business practices and outgoings first. Taking out a loan or seeking private equity can be a huge commitment for a struggling business, and it is often worth seeing if anything on the balance sheet can be cut out or operations streamlined before seeking larger scale support.
Dealmarket is a recent start-up company that shares insight on accessible private equity marketplace which includes venture capital.